Golf Is Leaving the Stage, and Taking Its Old Vanities With It | Market Inventors

The game has moved out of the well-off middle class and into a smaller, richer circle.

The medal ceremony for the men's stroke play in Rio had barely ended when Joe Posnanski, a columnist for NBC Sports, published an open letter calling out the top players who had stayed home.

It began like this—

Subject: To the golfers who missed the Rio Olympics—you blew it

To: Jordan Spieth Cc: Jason Day; Rory McIlroy; Dustin Johnson; Adam Scott; Hideki Matsuyama Bcc: Vijay Singh Title: Rio!

August 15, 2016

These names, which you probably do not recognize, belong almost entirely to players ranked in the world's top 20—and every one of them refused to go. Twenty-three golfers pulled out one after another before the Games opened, which is why this year's gold medalist, Britain's Justin Rose, was only the world No. 15.

Incidentally, golf's return to the Olympics this year came 112 years after its last appearance.

"They don't want to promote golf, and they don't realize how lucky they are," an angry Gary Player told reporters. "They don't know what the Olympics means to a sport." Player, now 81, is considered one of the greatest golfers who ever lived.

The bad news about golf has not come in ones and twos. Most of the players who withdrew cited security in Rio and the Zika virus, but the press generally agreed the real reasons were that the Olympic event paid no prize money and that it collided with a crowded calendar of professional opens and tour stops. Among the top women, who were said to face the greater infection risk, exactly one withdrew.

The real decline, as it happens, began in 2009. That was the year the IOC voted golf back into the Games—and the year Tiger Woods, who had endorsed the bid, began sliding off the peak of his career. Golf has not produced another player since who gathered every storyline and every trophy into one person.

Big companies are leaving too. On May 4, 2015, the Adidas Group announced it would sell its golf business, including TaylorMade, the largest maker of golf equipment in the world. On August 4 this year, Nike abruptly said it was quitting the equipment market altogether: no more balls, clubs, or bags, only shoes and apparel.

On one weekend afternoon in 2014, Matt Owens, who owns a course in the United States, collected $200 in green fees (the green is the patch of turf where the hole sits). He had been running the place for 12 years.

At the time, Greg Nathan, senior vice president of the National Golf Foundation, said: "Golf as a business is under enormous pressure. The boom from the mid-1980s through 2005 threw supply and demand out of balance. Courses are hard to sell and the competition is fiercer."

Players had been thinning out since the 2008 financial crisis, and the same thing was happening all over the United States in the years that followed.

Owens's course later became a park.

Golf Is Boring, But Rich People Love It

Golf is slow, loosely structured, and long. Those are precisely the qualities that make it good for doing business or working out a disagreement. In 2011, when President Barack Obama and House Speaker John Boehner went looking for common ground, they chose 18 holes.

This portable meeting room suits the upper class so well that club memberships are handed around as gifts, equivalent to status and contacts. Those same people have set the game's entry price accordingly: a standard 18-hole course takes anywhere from a hundred qing of land—about 670 hectares—to tens of thousands; the plainest set of clubs starts around a thousand yuan, before you pay a single green fee.

Golf began with the Scottish aristocracy in the late 19th century but—as you would guess—found its first mass following in America. The United States is the biggest market for the little white ball: 41% of all golf equipment sold worldwide, and nearly 30,000 courses across the country, about 75% of them public. How golf is doing in America tells you, more or less, whether the sport is rising or falling.

On February 6, 1971, Alan Shepard, on the Apollo 14 landing mission, hit a ball 200 meters with a 6-iron and left behind a line everyone remembers: "Miles and miles and miles." Television carried the lunar swing to the world.

Television, marketing, and books were doing the same thing in those years for another small ball, a yellow one: tennis. But the thousands of courts thrown up in the rush turned from money machines into surplus lots, and it took years before tennis settled back to a normal balance of supply and demand. Golf would have gone the same way had a superstar not appeared. America had Tiger Woods.

Tiger Woods, Tiger Woods, Tiger Woods

Woods bought golf roughly 10 extra years of attention.

He was born in Los Angeles to a mixed family: his father an African American and a Vietnam veteran, his mother of Thai, Chinese, and Dutch descent. Woods called himself "Cablinasian," a compression of Caucasian, Black, Asian, and African American. To most white Americans, his background was close to a synonym for mystery.

Like O.J. Simpson, the football star who was already famous the year Woods was born, Woods was a good-looking African American with startling physical gifts. In 1997, barely out of the gate, he won the Masters by a staggering 12 strokes, and took 8 PGA titles over the following year. He had signed a $40 million contract with Nike two years before that.

That was also when Nike decided to make golf equipment. In 2000, the year he switched to Nike's new ball, Woods swept three of the majors. In 1999, right behind Nike, Adidas bought TaylorMade, the biggest equipment maker in the American market, and moved into what looked like a sport with a future.

They did it because Woods's results were too bright to ignore; by himself he brought golf attention and commercial opportunity it had never had. In a 1996 Nike ad built around him, Black, Asian, and white children—some confident, some shy, some bewildered, some carrying a seriousness beyond their years—say into the camera, one after another, "I am Tiger Woods."

Between the marketing and the coverage, Woods stopped being only a golfer and became an icon for Americans of color. The Chicago Sun-Times put it this way: "Woods represents the best part of the American dream... Woods is the embodiment of our melting-pot culture, a symbol of the multicultural ideal we hold, and deserves to be called—an American."

Woods pushed golf to the front of American culture and argument, and the culture did shift. In 2010, three former Goldman Sachs employees sued the bank over its "golf-centered, male-dominated trading-floor culture." All three women had held senior jobs there—vice president, managing director, and partner. One of them, Ms. Orlich, said that although she had played golf in college, she was never invited to the firm's frequent outings.

After Woods turned pro, he hauled the number of American golfers from 24 million to a peak of 31 million. Then came 2009, the turning point. A sex scandal wrecked his image, and sponsors began quietly—or not so quietly—taking down his posters and dropping the drink lines named after him. Accenture was blunt about it, announcing that it was ending his contract and cutting ties. His endorsement income fell by more than $20 million the next year.

By one estimate, the year Woods sat out cost the golf industry $590 million, and the scandal cost Nike more than 100,000 customers.

Is Golf's Decline Also Tiger Woods's Doing?

What followed proved that people only wanted to watch Tiger Woods, not to be him.

The beginners his play pulled onto courses did not stay. Between 2000 and 2012, the number of occasional American golfers rose by 2.5 million, while the number playing more than eight rounds a year fell by 9.8 million.

The bubble golf had built, however, did not shrink at all. Steve Skinner works for Kemper Sports, a large course-management company, and he reckons it will take at least another decade to clear the oversupply of courses.

Brian Curley, a course designer who now works mostly in China, put it more plainly: "If golf-course designers were a publicly traded stock, they'd be the cheapest penny stock around."

China is a different story. Everything here looks like a rerun of America in the 1970s.

Dan Washburn, an American reporter for ESPN, first came in 2005 and spent nine years writing a book about it, The Forbidden Game: Golf and the Chinese Dream. In China's political climate golf was tied to capitalism and corruption, a "dangerous import that breeds decadence"—and yet the country's galloping economy lifted the sport anyway. Between 2005 and 2010, the number of Chinese golf courses tripled.

Zhou Xunshu, the golfer at the center of the book, did not start out rich. He had worked as a security guard at a course in Guangzhou, spending his days around the wealthy people he could never otherwise have met. Others who picked up a club in those years included farmers, a sushi chef, a stunt motorcyclist. Washburn used their stories to argue that a set of Chinese, carried by the confidence of a booming economy, changed their lives by becoming golfers.

In most mature markets, meanwhile—Australia, Japan, England, Ireland—golf is struggling. In England the number of people playing at least once a month has fallen by more than a quarter since 2007; in Australia club membership is down a fifth from its 1998 peak; in Japan participation has dropped more than 40% from its early-1990s high. A few places are doing fine—the Czech market is growing, and so is Germany's—but next to the United States they are too small to matter.

Plenty of causes are tangled together here. The 2008 financial crisis obviously hit hard at an industry that sells something close to a luxury. But as with the collapse of the American housing market, the industry may simply have been carrying a bubble that Woods had been holding up since the 1990s. Now that it has burst, things may only be returning to normal.

More to the point, today's executives and founders have far less spare time than the generation that loved the little white ball. The new kinds of business create no equivalent need to spend four hours on a round in order to size up a partner. Even if that need existed, the partner you are looking for probably would not turn up beside the greens at Augusta.

"What a startup worries about is whether it can get even one customer willing to pay," said Chris Heivly, co-founder of MapQuest. "Startups focus on building a product or service of value, and sometimes they don't even have to work at marketing it." For them, doing business over golf is too slow a way to get anything done.

The times argue against golf at every turn. A husband today cannot hand the children to his wife on a Saturday and disappear to the country club with three or four friends.

The "rich man's sport" label, on the other hand, has only grown sharper. As budget fights pushed American governments to close publicly run courses, the rich, untouched by any of it, discovered fresh enthusiasm for the game. Nearly half of American golfers now earn more than $100,000 a year, a share 40% higher than in 2005. No wonder Donald Trump has called for letting golf "be elitist": the 18 top-tier courses under his name are once again worth striving for.

Where Did the Young People Go

What young people want from a sport runs roughly like this: hard competition, a short and fast format, and—why not—good-looking kit. The popularity of a retro tennis shoe like the Stan Smith is proof enough that how a sport dresses matters.

They would rather play golf at home on an Xbox, because sinking a clean putt on real grass is much harder than doing it in a virtual world.

As entertainment has multiplied, the gap between the sedentary and the athletic has widened. Some 80 million Americans play no sport at all, while those who do get off the couch tend to pick something harder: triathlons, kite surfing—both better at burning off stress than golf.

As a mass pursuit, golf is losing the young.

Jordan Spieth, the most valuable golfer in the world, has just turned 23. The average age of a touring professional is 35; the average American recreational golfer is 54. In 2013, 200,000 players under 35 gave the game up.

"Winning back or holding on to golfers under 45 is harder now than it has ever been," The Economist wrote.

Spieth reached world No. 1 in the 2015 season and now sits third, but his $53 million in personal income reflects more than his play: charismatic young golfers are scarce. His endorsements include Coca-Cola, Under Armour, the telecom company AT&T, the private-jet firm NetJets, and Rolex. According to Forbes, Spieth's endorsement income is 1.6 times his prize money, and he was the only golfer that year to out-earn Tiger Woods.

On July 12, at the last moment before the Rio roster closed, Spieth announced "the toughest decision" to withdraw and promised to make the 2020 Tokyo Olympics his goal—if he still gets the chance to play for the United States.

That promise, like the future of the game itself, looks awfully thin.

(Charts: Lingwei Wu)